When helping a client plan for their retirement, financial advisers take many aspects into account, including an evaluation of any workplace pensions the client may hold. Having all the necessary valuation data pulled easily to hand can make this review process much easier.
Our latest insight looks at what valuation data is provided to advisers by workplace pension providers.
Gone are the days when financial advisers had to dig through realms of paperwork from the client when reviewing retirement plans. Nowadays most advisers expect a wide variety of workplace pension valuation data to be available on demand, delivered digitally for ease of review.
Our data shows that, other than Standard Life DC Master Trust, all workplace pension providers offer a wide range of valuation data in a digital format, and most providers do this automatically online.
However, for advisers whose client has a policy with Aegon Master Trust or Aegon Workplace ARC the digital valuation data must be electronically triggered by the adviser. If the client has a policy with True Potential the valuation data must be requested manually.
Other than Standard Life DC Master Trust, all providers offer a wide range of contract identification data including product type, product name and policyholder details. Most also include policy number, product sub-type and contract details.
Only Aegon Master Trust, Aegon Workplace ARC, and True Potential include the intermediary/adviser reference number in the valuation data.
When reviewing retirement provision for a client, the adviser will also ideally want to know the transaction history for any workplace pension.
Our data shows that other than Standard Life DC Master Trust, workplace pension providers include a wide range of transaction history data with their valuations including single contributions, regular contributions, transfers-in, fund invested for each contribution, encashments/withdrawals, fund switches, and decreases/increases in the number of units for each fund.
Most providers offer this is standard, but advisers will need to request this data electronically for Aegon Master Trust and Aegon Workplace ARC, and need to request it manually for True Potential.
Bank account transactions are only included by just over half of workplace pension providers and less than half offer share transaction data, commercial property data and valuation references. Only Scottish Widows and Standard Life offer all of this data within their valuations.
Advisers will often review the risk profile of any investments held within a workplace pension as part of any retirement planning review with a client.
Other than Standard Life DC Master Trust, all workplace pension providers offer a fund breakdown in their valuation data including fund choice, fund split and fund code.
Most providers also offer help with projecting retirement income with all workplace pension providers other than Standard Life DC Master Trust including a projection of total fund value within their valuations. Other than Standard Life DC Master Trust, Fidelity and Fidelity Master Trust all also offer a projected pension at retirement. The majority of providers are able to adjust this projected pension at retirement based on whether contributions will continue.
As part of the retirement planning review, an adviser is likely to want to know what the transfer value of a workplace pension would be should they be considering a client transfer and/or consolidate a workplace pension. Other than Standard Life DC Master Trust, all providers include transfer value in their valuation data.
They may also wish to easily see what the exit charge would be should they be considering this option. However, only Aviva Designer, Aviva My Money, Aviva My Money Master Trust, Hargreaves Lansdown, Legal & General, Legal & General Master Trust, Mercer Master Trust Aviva, Mercer Master Trust Scottish Widows, Scottish Widows, Standard Life and True Potential include exit charges in the valuation data they provide.
One area that could perhaps be improved by workplace pension providers is the provision of valuation information for assets and products held elsewhere. Only Aegon Master Trust, Aegon Workplace ARC, Legal & General and Legal & General Master Trust are able to provide this. Details of the asset can then be recorded on their system and the system can report against this asset ie. Obtain current information.
Our data shows that when it comes to linking the valuation statement into other retirement planning tools for advisers, some workplace pension providers clearly believe in them more than others. Fidelity, Fidelity Master Trust, Hargreaves Lansdown and Royal London do not link their valuation statement into any adviser tools.
The most commonly offered tools are a risk profiling tool, tax free cash calculator, and a “what if” calculator. The least commonly offered tools are portfolio modelling tools and annual allowance calculators.
Most providers update the data for these tools daily.
Overall, our data shows that all providers other than Standard Life DC Master Trust offer a wide range of data on their valuations. Whilst for some this must be triggered manually or electronically for the adviser, for most providers this information is also readily available digitally to make life easy for the adviser.